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Use the table below to navigate income and sales tax exemptions by state. Consider exemption in each
state where your nonprofit operates. States may offer exemption from corporate income, sales, use,
and other taxes that they levy. Typically, you’ll need to submit an application to the Department of
Revenue. Review regulations and mark your calendar as renewals may be required and can range between
1 and 5 years.
Most nonprofit organizations will not qualify for a sales tax exemption in Alabama. Alabama Statutes § 40-9-1 et seq describes organizations that may qualify for an exemption.
Alaska
Alaska
Income tax exemption:
Not required
Exempt upon obtaining Determination Letter from the IRS
More information: Alaska Department of Revenue
Sales tax exemption:
Not required
Alaska does not currently have a state level sales tax.
Arizona
Arizona
Income tax exemption:
Not required
Exempt upon obtaining Determination Letter from the IRS
More information: Arizona Department of Revenue
Transaction Privilege Tax Exemption:
Agency:
Arizona Department of Revenue
Notes:
Arizona does not offer an overall exemption for nonprofits, but they allow exemptions in some circumstances. For a list of the few available exemptions, contact the Arizona Department of Revenue.
Apply by submitting a copy of the IRS Determination Letter, the first two pages of IRS Form 1023, and a statement declaring exemption under ACA 26-51-303 or ACA 26-51-309. Organizations without an IRS Determination Letter should submit Form AR1023CT, a copy of the articles of incorporation, and a copy of the bylaws.
Arkansas does not offer a general exemption application for nonprofits, but charitable sales are exempted under certain conditions. The certificate of exemption can be used to exempt an organization from sales tax in a specific purchase.
Use form FTB-3500a if you have received an IRS Determination Letter and form FTB-3500 if you have not.
Sales Tax Exemption:
Agency:
California Department of Tax and Fee Administration
Notes:
Few nonprofits are eligible for sales tax exemption in California. Volunteer fire departments, veteran's organizations, qualifying youth organizations, religious organizations, and few others may be eligible for exemption. See the Sales and Use Taxes: Exemptions and Exclusions guide to see if your organization is eligible to apply for an exemption.
Colorado
Colorado
Income tax exemption:
Not required
Exempt upon obtaining Determination Letter from the IRS
More information: Colorado Department of Revenue
Exemption form Sales Tax & State-Administered Local Sales Tax:
Colorado organizations can apply for state sales tax exemption if they have an IRS determination letter. If approved, you will receive a Certificate of Exemption.
Connecticut
Connecticut
Income tax exemption:
Agency:
Connecticut Department of Revenue Services
Notes:
Exemption from Connecticut income tax is obtained by submitting a copy of your IRS Determination Letter when submitting Form REG-1.
Sales tax exemption:
Not required
Upon receiving an IRS determination letter, Connecticut nonprofits are automatically exempt from state sales tax. Organizations must follow the guidelines in Guide SN 95(10). This includes providing sellers with a copy of CERT-119: Purchases of Tangible Personal Property and Services by Qualifying Exempt Organizations.
Delaware
Delaware
Income tax exemption:
Not required
Any corporation granted an exemption by the IRS as a non-profit organization under Section 501(c) is exempt from Delaware Corporate Income Tax.
More information: Delaware Department of Finance - Division of Revenue
Sales tax exemption:
Not required
Delaware does not collect sales and use taxes at the state level.
Foreign organizations must have an office or physical location in DC to be eligible.
A certificate of authority is also required of foreign organizations.
Paper exemption applications are available upon request.
Florida
Florida
Income tax exemption:
Agency:
Florida Department of Revenue
Notes:
Not-for-profit corporations are subject to corporate income tax. However, a not-for-profit corporation that is exempt from federal taxation under Internal Revenue Code section 501(c)(3) is only required to file a Florida corporate income tax return (Form F-1120) if it has unrelated business income or it files federal Forms 990-C or 990-T with the Internal Revenue Service.
Certain not-for-profit organizations are exempt from sales and use tax on purchases and rentals of tangible personal property if that property is used in carrying out the organization's not-for-profit activities. See the form for information on the available exemptions.
Georgia
Georgia
Income tax exemption:
Agency:
Georgia Department of Revenue
Notes:
Simply attach your IRS Determination Letter and Letter of Incorporation to your tax returns.
Sales tax exemption:
Agency:
Georgia Department of Revenue
Notes:
Georgia currently does not provide a general sales or use tax exemption. A few exemptions exist for nursing homes, hospices, hospitals, and other organizations, and you can contact the Georgia Department of Revenue for a full list.
Hawaii
Hawaii
Income tax exemption:
Not required
Your IRS determination letter granting exemption from federal income taxes, also exempts your organization from Hawaii income taxes. Organizations that are not required to file an application for recognition of exemption with the IRS are exempt from Hawaii income taxes.
Attach your IRS Determination Letter. This application is due within 120 days of incorporation. The department will return a Nonprofit Tax Registration Certificate and you can use Form ST-105: General Sales Tax Exemption Certificate to provide your exemption information to sellers.
This form is due within 120 days of incorporation, and you must attach your IRS determination letter.
Iowa
Iowa
Income tax exemption:
Not required
Your nonprofit is automatically exempt from Iowa income tax when you receive IRS income tax exemption.
More information: Iowa Department of Revenue
Sales tax exemption:
Not required
Iowa nonprofits receive limited exemption from sales tax. Sales made to nonprofits are not exempt from sales and use tax. The exception is private nonprofit schools do not pay sales tax on the purchase of goods and taxable services used for educational purposes. Also, sales made by educational, religious, or charitable organizations are exempt on proceeds expended for qualifying educational, religious, or charitable purposes.
Kansas
Kansas
Income tax exemption:
Not required
Your nonprofit is automatically exempt from Kansas income tax when you receive IRS income tax exemption.
In general, Louisiana nonprofits are not exempt from sales and use tax. You can request an exemption for a fundraiser by filing an exemption application at least 2 weeks prior to the event.
Maine
Maine
Income tax exemption:
Not required
Upon obtaining your IRS Determination Letter, your organization is automatically exempt from Maine corporate income tax. No application or notification is necessary.
Maine has a large number of sales tax exemptions, and you will file a form specific to your type of organization.
Maryland
Maryland
Income tax exemption:
Agency:
Comptroller of Maryland
Agency Fee:
$0
Notes:
Submit: Request for exemption from Maryland income tax, an explanation of the nature, purpose, and scope of your organization, IRS tax determination letter, by-laws, and latest financial statement of your organization.
Submit: Registration (if not already registered), a copy of the IRS Determination Letter of Exemption granting the corporation Section 501 (c) status, a copy of the Articles of Organization filed with the Secretary of State's Office, and a copy of the IRS documentation of Employer Federal Identification Number if it is not stated on the IRS Section 501 (c) Determination Letter.
Sales Tax Exemption:
Agency:
Massachusetts Department of Revenue
Notes:
There is no application form for sales tax exemption; simply send in your IRS determination letter with an explanation and the department will review the request.
Michigan
Michigan
Income tax exemption:
Not required
Nonprofits are exempt from Michigan's 6% Michigan Corporate Income Tax (CIT). No filing is needed.
More information: Michigan Department of Treasury
Sales and Use Tax Exemption:
Not required
Michigan nonprofits are automatically exempt from state sales and use tax. Simply complete and present Form 3372: Michigan Sales and Use Tax Certificate of Exemption to sellers and vendors.
Minnesota
Minnesota
Income tax exemption:
Not required
Upon obtaining your IRS Determination Letter, your organization is automatically exempt from Minnesota corporate income taxes. No application or notification is necessary.
Certain nonprofit corporations qualify for tax-exempt status under Mississippi law. To apply for exemption from Corporate and Franchise taxes, submit your IRS determination letter to the Mississippi Department of Revenue.
Sales tax exemption:
Notes:
Mississippi nonprofit organizations are not exempt from state sales tax, with a few exceptions. Review the full of list of exemptions on the Department of Revenue website.
Missouri
Missouri
Income tax exemption:
Not required
Missouri nonprofits that file IRS Form 990 are exempt from Missouri corporation income tax.
Montana nonprofits may apply for exemption from Montana's Corporation License Tax (6.75%) after receiving their IRS Determination Letter.
Sales tax exemption:
Not required
Montana does not currently have a state level sales tax.
Nebraska
Nebraska
Income tax exemption:
Not required
If you have 501(c) exemption, you are automatically exempt from Nebraska income tax. If you have unrelated business income you need to file Nebraska corporate income taxes.
If the IRS Determination Letter grants 501(c) recognition, then your organization is also exempt from New Hampshire corporate income tax (the "New Hampshire Business Profits Tax").
More information: New Hampshire Department of Revenue Administration
Sales tax exemption:
Not required
New Hampshire does not currently have a state level sales tax.
New Jersey
New Jersey
Income tax exemption:
Not required
If a nonprofit organization is incorporated and operating as a nonprofit corporation, it is exempt from the New Jersey Corporation Business Tax. You may request a letter from the Division of Taxation confirming exemption from corporation business tax.
More information: New Jersey Department of the Treasury
Sales Tax Exemption:
Agency:
New Jersey Department of the Treasury - Division of Taxation
Upon obtaining your IRS Determination Letter, your organization is exempt from New Mexico corporate income tax and franchise tax.
More information: New Mexico Taxation and Revenue Department
Gross Receipts Tax Exemption:
Not required
If your IRS determination letter stipulates that your nonprofit is an educational or social organization, you are automatically exempt from New Mexico’s gross receipts tax. If you purchase taxable goods, you can apply for a Nontaxable Transaction Certificate (NTTC). You will file Form ACD-31050: Application for Nontaxable Transaction Certificates with the New Mexico Department of Taxation and Revenue.
Certain not-for-profit and religious corporations are exempt from the New York State corporation franchise tax. You must file Form CT-247 to apply for exemption.
Send your Articles of Incorporation, Bylaws, and other organizational documents along with your IRS Determination letter to the Department of Revenue.
Sales and Use Tax Exemption:
Not required
North Carolina currently does not offer an exemption from sales tax. However, the state offers semiannual refunds for qualified organizations. You will file Form E585: Nonprofit and Governmental Entity Claim for Refund with the North Carolina Department of Revenue.
North Dakota
North Dakota
Income tax exemption:
Not required
Upon obtaining your IRS Determination Letter, your organization is automatically exempt from North Dakota corporate income tax. No application or notification is necessary.
More information: North Dakota Office of State Tax Commissioner
Sales tax exemption:
Not required
Most North Dakota nonprofits are not able to become exempt from sales tax. Certain organizations, such as hospitals and schools are automatically exempt.
Ohio
Ohio
Income tax exemption:
Not required
Generally, nonprofit corporations are not subject to the Ohio commercial activity tax. Agricultural and consumer cooperatives are.
More information: Ohio Department of Taxation
Sales tax exemption:
Not required
Ohio nonprofits that have received their IRS determination letter are automatically exempt from paying state sales tax. They must present Form STEC-B: Sales and Use Tax Blanket Exemption Certificate to sellers.
Oklahoma
Oklahoma
Income tax exemption:
Not required
Upon obtaining your IRS Determination Letter, your organization is automatically exempt from Oklahoma corporate income tax. No application or notification is necessary.
Not all 501(c) recognized nonprofits are exempt from sales tax. There are a number of specific exemptions that exist.
Oregon
Oregon
Income tax exemption:
Not required
If you are an exempt organization under Internal Revenue Code (IRC) Sections 501(c) through (f), 501(j), 501(n), 521, or 529, you are exempt from Oregon Corporation taxes (ORS 317.080). You don't have to apply to the Oregon Department of Revenue. Two exceptions to this are nonprofit homes for the elderly and people's utility districts.
More information: Oregon Department of Revenue
Sales tax exemption:
Not required
Oregon does not currently have a state level sales tax.
Pennsylvania
Pennsylvania
Income tax exemption:
Not required
Upon obtaining your IRS Determination Letter, your organization is automatically exempt from Pennsylvania corporate income tax. No application or notification is necessary.
More information: Pennsylvania Department of Revenue
Once every five years. Approximately 2 months before an organization's sales tax exemption expires, the Department of Revenue will send a renewal packet to the organization.
When you receive your IRS Determination Letter granting federal income tax exemption (and file IRS Form 990 or 990EZ annually), you are automatically also granted exemption from Rhode Island corporate income tax. You need not apply or notify the Rhode Island Division of Taxation.
More information: Rhode Island Department of Revenue - Division of Taxation
Sales & Use Tax Exemption:
Agency:
Rhode Island Department of Revenue - Division of Taxation
Certain nonprofit organizations in South Carolina are exempt from sales and use tax on items sold by the organizations for charitable purposes. The exemption applies only to items purchased for resale and does not apply to items purchased by an organization for its own use.
South Dakota
South Dakota
Income tax exemption:
Not required
South Dakota does not have a state or corporate income tax.
More information: South Dakota Department of Revenue
Only certain organizations are eligible to apply for a sales tax exempt permit.
Tennessee
Tennessee
Income tax exemption:
Not required
Franchise and excise taxes are not applicable to nonprofit corporations as defined by law. The Application for Exemption - Franchise and Excise Taxes form is for other exemptions.
Exemption certificates are only issued to Tennessee nonprofits. Out-of-state nonprofits should instead present their IRS determination letter to vendors.
Texas state law permits 501(c)(3) exempt and various other types of organizations to be exempt from paying sales tax, hotel occupancy tax, and franchise tax.
Upon obtaining your IRS Determination Letter, your organization is automatically exempt from Vermont minimum corporate tax. No application or notification is necessary.
More information: Vermont Department of Taxes
Sales tax exemption:
Not required
Vermont nonprofits that have received their IRS determination letter are automatically exempt from paying state sales tax. They must present Form S-3: Vermont Sales Tax Exemption Certificate for Resale and Exempt Organizations to sellers.
Virginia
Virginia
Income tax exemption:
Not required
Upon obtaining your IRS Determination Letter, your organization is automatically exempt from Virginia corporation income tax. No application or notification is necessary.
In Washington, nonprofit organizations are generally taxed like any other business. They must pay business and occupation (B&O) tax on gross revenues generated from regular business activities they conduct. They must pay sales tax on all goods and retail services they purchase as consumers, such as supplies, lodging, equipment, and construction services. In addition, nonprofit organizations must collect and remit retail sales tax on their sales of goods and retail services.
Currently, Washington does not grant nonprofits exemption from state sales tax. They must pay sales tax on all goods and retail services they purchase as consumers, such as supplies, lodging, equipment, and construction services. In addition, nonprofit organizations must collect and remit retail sales tax on their sales of goods and retail services. Limited B&O and sales tax exemptions are provided for nonprofit fundraising activities, donations, and for certain types of organizations.
West Virginia
West Virginia
Income tax exemption:
Agency:
West Virginia State Tax Department
Notes:
Any corporation exempt from federal income tax is also exempt from West Virginia Corporation Net Income Tax and Business Franchise Tax. Nevertheless, a tax exempt organization's annual West Virginia Corporation Net Income/Business Franchise Tax Return is due on or before the 15th day of the fifth month after the close of the taxable year.
West Virginia uses a multi-state form that is not actually submitted with the West Virginia State Tax Department. West Virginia nonprofits should complete the form and display to sellers, but out-of-state nonprofits are generally allowed to use exemption certificates from another state. The form is rather complex, and not accepted in all states. Be sure to read the instructions carefully.
Wisconsin
Wisconsin
Income tax exemption:
Not required
Upon obtaining your IRS Determination Letter, your organization is automatically exempt from Wisconsin corporation franchise and income taxes. No application or notification is necessary.
To become exempt from Wyoming sales tax, simply submit your IRS Determination Letter to the Wyoming Department of Revenue. Alternatively, submit articles of incorporation, constitution or bylaws, mission statement, budget, and income/expense statement for the past three years. When the Wyoming Department of Revenue approves your exemption, they will send you a Streamlined Sales/Use Tax Agreement (SSUTA) Certificate of Exemption.
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